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> The West (USA + Canada, EU + UK, Australia) could circle the wagons, form a trading bloc, essentially negotiate with China as a single entity and start a trad

> The West (USA + Canada, EU + UK, Australia) could circle the wagons, form a trading bloc, essentially negotiate with China as a single entity and start a trade war if China did not bend. But even if they wanted to do so, the cost would be high in the short term and voters would punish them. China depends a lot less on trade than NATO countries, something like 3% of their GDP is making stuff for Western consumers. If there is a serious Trade War their main concern would be their own real estate market instead of selling plastic toys to US consumers. China's secondary trading block are near Asian countries. The "west" collectively have a population LESS than China, and they cannot even hold the "EU" together. China also has major cards, in a situation that you describe above does happen. - The first thing China will do is sell their treasury holdings, creating enough shockwaves in the bond market to wipe of the retirement saving of most boomers, (remember that the median US national has no saving). - They will unilaterally stop following any sanction / not officially , but unofficially they will sell whatever Iran / NK / Russia want to buy from them. Iran alone has enough oil reserves to meet their energy needs, not to bring up the cozy relationship between Putin and Xi. - 1970 style inflation in western countries that have outsourced all their electrial engineering work to China, the west doesn't have a collection of mega city that is the Pearl River Delta - China's greatest asset. There is no way greater New York will be able compete directly with PRD. It will require infrastracture spending at a level that would be unprecedented in US history comparable to WW2 - putting inflation pressure on resources. Not to mention major displacement of workers - who might not want to go back to working in a factory floor. All this will be painful to both the "West" and China. > What might stop China is if another large country such as India, Indonesia or Nigeria decided to position themselves as the ethical alternative: cheap labor and manufacturing without the rampant state sponsored IP theft. Try starting a tea shop in India and then come back to me - I know I tried. You will have to pay bribe to 3 government bureaucrats, 5 state bureaucrats, 2 local mafias leader, leaving aside politians who will come at our door if your business gets big enough. India / Indonesia are democracies with all the mess that democracy involves. Most MNCs rather put their money in Saudi Arabia then invest in unstable democracies. India / Indonesia will industrialize on their own terms and will mostly stay neutral since they dislike being pawns between great powers.

throwawaybeijjj 7y ago
US-China trade decline leads to 20.7 per cent plunge in China’s total exports in February https://www.scmp.com/economy/china-economy/article/2189128/us-china-trade-decline-leads-207-cent-plunge-chinas-total https://www.scmp.com/economy/china-economy/article/2189128/u... "Andy Wong, an export manager of Guanya Lighting, said that his company, which mainly sells desk lamps, is struggling to make adjustments to the new global trade reality, in which bulk orders for thousands, or even tens of thousands, of lamps from US and European retailers have disappeared, replaced by small orders from smaller buyers in “Belt and Road Initiative” countries in Asia and Africa as part of China's plan to grow global trade." “We used to set a minimum order of 1,000 units. Now we take minimum orders of 20 units,” he said. China’s exporters fear heyday is over amid sour mood at Canton Fair as US-China trade war lingers https://www.scmp.com/economy/china-economy/article/3006884/chinas-exporters-fear-heyday-over-amid-sour-mood-canton-fair https://www.scmp.com/economy/china-economy/article/3006884/c...
- baybal2 7y ago
  It is more like Chinese companies are now gobbling up trade share of US in the world. No longer smaller countries have to buy US branded Chinese goods. They can simply buy direct.
cinquemb 7y ago
As someone living in Indonesia for almost 4 years from the US and no plans to leave any time soon, and having learned a lot of the realities on the ground and in the political scene: - Indonesian's will never let the Chinese run over them like they have, like for instance, Sri Lanka, etc. Sure, they will buy cheap Chinese goods begrudgingly when something else better may be priced out of their range, but make no mistake, the government will continue to sink Chinese fishing boats encroaching into their waters and the people, if called upon within their religious communities (esp from groups like FPI which has fringe connections to not only the fmr general under the 30 years president [and some US 3 letter agencies through him]), many will go to every suspected Chinese house/business) and rob/steal/rape and kill (1960's and 1990's). - In Indonesia, this is very much not the case how they perceive western governments (or people), though they very much want to pursue what is best for them on their own terms but the political establishment understands that needs to come from an economic standpoint first and foremost. One way they do this now is by managing foreign denominated liabilities through strict import policies. If you haven't noticed, major manufactures in the world over the past 20 years have been increasing their operations in Indonesia… Cant speak for India, but the biggest tail risk for any Indonesian government is the lack of ability to bring some of the economic wealth from the bigger cities and tourist attractions to those places that lack it because there are some pretty big logistical challenges with all of the islands and lack of incentives (outside of the gov partnerships with some western companies for natural resource extraction) for big corporate and political parties alike (they like to show up during elections and disappear until the next one) to do anything sustainable.

throwawaybeijjj 7y ago

US-China trade decline leads to 20.7 per cent plunge in China’s total exports in February https://www.scmp.com/economy/china-economy/article/2189128/us-china-trade-decline-leads-207-cent-plunge-chinas-total https://www.scmp.com/economy/china-economy/article/2189128/u... "Andy Wong, an export manager of Guanya Lighting, said that his company, which mainly sells desk lamps, is struggling to make adjustments to the new global trade reality, in which bulk orders for thousands, or even tens of thousands, of lamps from US and European retailers have disappeared, replaced by small orders from smaller buyers in “Belt and Road Initiative” countries in Asia and Africa as part of China's plan to grow global trade." “We used to set a minimum order of 1,000 units. Now we take minimum orders of 20 units,” he said. China’s exporters fear heyday is over amid sour mood at Canton Fair as US-China trade war lingers https://www.scmp.com/economy/china-economy/article/3006884/chinas-exporters-fear-heyday-over-amid-sour-mood-canton-fair https://www.scmp.com/economy/china-economy/article/3006884/c...

baybal2 7y ago
It is more like Chinese companies are now gobbling up trade share of US in the world. No longer smaller countries have to buy US branded Chinese goods. They can simply buy direct.

cinquemb 7y ago

As someone living in Indonesia for almost 4 years from the US and no plans to leave any time soon, and having learned a lot of the realities on the ground and in the political scene: - Indonesian's will never let the Chinese run over them like they have, like for instance, Sri Lanka, etc. Sure, they will buy cheap Chinese goods begrudgingly when something else better may be priced out of their range, but make no mistake, the government will continue to sink Chinese fishing boats encroaching into their waters and the people, if called upon within their religious communities (esp from groups like FPI which has fringe connections to not only the fmr general under the 30 years president [and some US 3 letter agencies through him]), many will go to every suspected Chinese house/business) and rob/steal/rape and kill (1960's and 1990's). - In Indonesia, this is very much not the case how they perceive western governments (or people), though they very much want to pursue what is best for them on their own terms but the political establishment understands that needs to come from an economic standpoint first and foremost. One way they do this now is by managing foreign denominated liabilities through strict import policies. If you haven't noticed, major manufactures in the world over the past 20 years have been increasing their operations in Indonesia… Cant speak for India, but the biggest tail risk for any Indonesian government is the lack of ability to bring some of the economic wealth from the bigger cities and tourist attractions to those places that lack it because there are some pretty big logistical challenges with all of the islands and lack of incentives (outside of the gov partnerships with some western companies for natural resource extraction) for big corporate and political parties alike (they like to show up during elections and disappear until the next one) to do anything sustainable.